Tax fear back
By Michael Esposito
25th May 2010 11:06:55 AM
Anxious over tax…Andrea Breem and son Xavier at her Beveridge property. 47431 Picture: EMILY LANE
Andrea Breem is dreading this week’s parliamentary debate on the proposed land tax for properties in Melbourne’s fringe suburbs.
The Beveridge resident is concerned the $95,000 per hectare Growth Areas Infrastructure Contribution (GAIC) will be passed in parliament after more than a year of strong opposition by residents, lobby groups and the Coalition.
The amended bill, which would only affect properties larger than 10 hectares, is expected to be passed this week, paving way for the government to introduce a new urban growth boundary, which would extend to suburbs such as Beveridge and Werribee.
Ms Breem lives on an 11.5ha property and is worried the bill would destroy her chances of selling.
“We just would never be able to sell. I think what they’ve come up with is a deal for the government and just left us landowners out in the cold again,” she said
If the bill is passed, buyers of land would pay 30 per cent of the GAIC up front and the remaining 70 per cent per hectare when they subdivide. Properties smaller than 10ha would be exempt.
“Lifting the size really hasn’t solved the problem,” Ms Breem said. “The real problem is still there, it should be done at the point of development.”
”We wouldn’t have a hope in hell of selling if we were up against people with just under 10ha.
”Eleven-and-a-half hectares isn’t a huge parcel of land, it’s not going to be that attractive to a developer. You need to get up to the 100-200 mark to make it worthwhile for developers.
“If you wanted to sell it to someone just for it to be grazing land, it still attracts a tax. It’s garbage.”
Ms Breem said she felt let down by the opposition, which after rejecting the bill in its original form, brokered a compromise deal with the government.
“I suppose they’re trying to meet in the middle somewhere, but I don’t think it’s anywhere near the middle. And for us it’s quite extreme, because the only fair way to do it is when you subdivide,” she said.
Shadow minister for planning Matthew Guy said the amended bill was a “victory” for landowners, because 90 per cent of properties would now be exempt from the tax.
“This represents a rise in the GAIC-free threshold of five times above what the government most recently proposed,” he said.